The mechanism of leukocyte chemotaxis is being studied as a model for signal transduction by a G-protein coupled receptor. Protein carboxyl methylation is being studied as a reversible posttranslational modification found in a number of membrane proteins possibly involved in signal transduction. Protein carboxyl methylation may provide a novel target for pharmacologic manipulation of a variety of signaling systems controlling cell growth, motility, neurotransmitter release, and cell-cell interactions. A. The role of methylation in membrane attachment and function of G- proteins was studied. We have demonstrated carboxyl methylation and processing of the G-protein gamma-subunit in brain. The G-protein gamma-subunit contains a C-terminal Cys-Axx-Axx-Xxx sequence, which is modified by a multi-step process including isoprenylation and methylation. Adding a C-terminal cys-Axx-Axx-Xxx sequence to a soluble protein was sufficient for specifying isoprenylation but not methylation. Isoprenylation alone was not sufficient for membrane attachment. B. We have identified a GTP-dependent carboxyl methylation of several low-molecular weight GTP-binding proteins, including G25K in brain. A soluble form of unmethylated G25K was isolated from brain homogenates as a heterodimer with a guanine-nucleotide dissociation inhibitor (GDI) protein. The GDI protein inhibited methylation of G25K unless GTPgammaS was bound, and after methylation G25K associated with the membrane. By altering the localization of these proteins, methylation may act as a molecular switch to regulate transduction of specific biochemical signals.